Chicago's Golden Gloves not compliant with Illinois, IRS

Jared S. Hopkins, Tribune reporter

By the end of the Golden Gloves tournament in Cicero next month, hundreds of spectators will have filled the stands to watch a new generation of young boxers vying to join a group of champions that includes Cassius Clay and Sonny Liston.

But it's outside the ring where the local nonprofit responsible for the storied amateur event here struggles to find its footing. Although the organization last week began submitting paperwork to rectify its problems, records and interviews show that it remains out of compliance with Illinois and federal authorities.

The IRS revoked Chicagoland Golden Gloves Charities' federal tax-exempt status May 15, 2010, after it failed for three years to submit tax returns, according to the federal agency. That means it must pay taxes and is responsible for future tax liabilities resulting from losing its status. And those who gave donations or paid fees — such as entry fees for boxers — are not eligible for tax deductions.

Separately, as the Tribune reported at the time, the group's charitable registration with the Illinois attorney general's office was canceled last October — the second time that's happened — because annual reports were overdue. The attorney general's office requires registration from any group fundraising or soliciting money. Penalties can include fines and legal actions.

The nonprofit submitted registration materials late last week to the state and included a document that says it is "in the process of reinstating" its federal tax-exempt status. That action came as this year's tournament was getting underway.

On Monday, a spokeswoman for Illinois Attorney General Lisa Madigan said the process was not complete. Late fees and additional financial records are still needed, according to a letter Madigan's office sent to the charity Monday.

"Charitable organizations have a duty under Illinois law to report how their funds are being used and an obligation to uphold ethical operating standards in the public's interest," said Madigan spokeswoman Maura Possley. "This reporting requirement allows donors to review a charity's financial information to help ensure their donation will be used in ways they consider appropriate."

Sam Colonna, a Chicago boxing trainer and local Golden Gloves board member, said the organization enlisted the help of an attorney and accountant to meet compliance issues. "We're on top of everything and everything's being worked out," he said.

Ted Gimza, who for years has managed the Chicago tournament while serving as its representative to the national Golden Gloves, could not be reached for comment.

But three national boxing officials said Gimza, who last year pleaded guilty to a felony weapons charge in Lake County, is no longer managing the tournament.

And in the materials submitted to the state, Gimza is no longer listed as treasurer and board director of Chicagoland Golden Gloves Charities. In its letter Monday, the attorney general's office requested the date when Gimza left the nonprofit.

James Beasley, executive director of the national Golden Gloves, said the event would be overseen by Dr. Glenn Bynum, president of the Chicago chapter and also a local board member. Beasley said he was unaware of compliance issues.

USA Boxing President Charles Butler and national Golden Gloves President Ray Rodgers also said Gimza was no longer running the tournament. Bynum, a longtime ringside physician, declined to comment.

Beasley said local chapters can use the national organization's tax-exempt status and are not required to be their own separate entity. But he said he didn't know if Chicago's chapter was doing that.

"I don't actually know," he said. "I was unaware of their status being changed."

Beasley said he had been unable to reach Gimza several months ago. Then, in January, Bynum told Beasley that he too had not heard from Gimza and would be leading this year's Chicago tournament, according to Beasley.

The steps to register come almost five months after the attorney general's office first issued subpoenas seeking bank records. The attorney general also sent several letters seeking registration.

In 2005, Golden Gloves' registration with the attorney general's office was canceled for failure to submit annual reports. It was not restored until last June, after past reports were submitted. After missing another report, the charity saw its registration canceled again in October.

According to the local chapter's 2011 tax return, the most recent available, it raised about $80,000 in revenue, a decline from about $125,000 the previous year. It shows that Gimza, who has run Chicago's program since 2004, was paid $9,000 in 2011.

Last year, Gimza received two years of probation on the weapons charge and was ordered to complete 100 hours of community service.

USA Boxing, which regulates amateur boxing and oversees membership, is investigating Gimza because of the weapons case, according to interviews and letters reviewed by the Tribune.